AI Sector Crisis Could Trigger Money Printing, Boosting Bitcoin
Arthur Hayes, co-founder of BitMEX, has warned that a crisis in the AI sector could lead to money printing and boost Bitcoin's value. In his latest essay, 'Safety First', Hayes argues that U.S. laboratories' decision to slow down AGI development on safety grounds may be a sign of weaker-than-expected demand for current products.
A reduction in training spending could undermine demand for data centers and chips, putting pressure on over $1 trillion in investment-grade debt and hundreds of billions of dollars in lower-rated loans tied to AI infrastructure, Hayes claims. This credit stress could force the U.S. government to either become a 'compute buyer of last resort' or support insurers exposed to AI-related debt.
According to Hayes, either of these outcomes would result in an increase in dollar liquidity and benefit Bitcoin and other crypto assets. He believes that the environment would tend to favor Bitcoin due to increased liquidity.